Oil prices rally after Saudi Arabia’s announcement on exports

New York : Oil prices extended gains with the US crude posting best daily gain in two weeks, after Saudi Arabia said it would cut oil exports in November.

The West Texas Intermediate for November delivery on Tuesday increased $1.34 to settle at $50.92 a barrel on the New York Mercantile Exchange, while Brent crude for December delivery rose $0.82 to close at $56.61 a barrel on the London ICE Futures Exchange.

According to media reports, Saudi Arabia would cut its November crude oil allocations to customers by 560,000 barrels a day, according to Andrew Lipow, president of Lipow Oil Associates.

The Organization of the Petroleum Exporting Countries (OPEC), Russia and several other producers have cut production by about 1.8 million barrels per day since the start of 2017.

Lipow said the potential impact of maintenance season on demand for Saudi supplies, but said any drop in exports from OPEC’s biggest producer is bullish to the extent it takes oil off the market.